July 1 (Bloomberg) -- Comedian Stephen Colbert got
permission from the U.S. Federal Election Commission to form a
“super PAC” that can raise unlimited money from corporations,
unions and individuals to support or oppose candidates in 2012.

Colbert, who portrays a conservative television commentator
on Comedy Central’s “Colbert Report,” sought a media exemption
to let him use the show’s resources, such as air time and staff,
without it being viewed as an in-kind contribution to Comedy
Central’s parent company, Viacom Inc.

“I do not accept limits on my free speech,” Colbert told
a crowd outside the commission’s office in Washington yesterday.
“But I do accept Visa, MasterCard or American Express.”

The 5-1 ruling, permits Colbert to run ads only on his
program. If ads created using Viacom resources are shown on
other networks or the company funds the PAC’s administrative
expenses, such as legal fees, Viacom would have to report the
expenses as political contributions.

“The Colbert Report” has satirized last year’s U.S.
Supreme Court ruling that lets corporations and unions spend
unlimited funds to support or oppose candidates by forming super
PACs. Advocates for stricter campaign finance laws opposed that
decision, saying it gave rich donors too much influence.

Swarmed by Fans

During the hearing Colbert largely played it straight,
speaking only to answer the commissioners’ questions.

Colbert saved his jokes for the throng of fans who swarmed
him after the ruling, handing him credit cards and cash
donations.

“Fifty dollars or less please, because then I don’t have
to keep a record of who gave it to me,” he said. “Also, please
remember that your gift is not tax deductible for you. It is tax
exempt for me.”

Colbert refused to say what he intends to do with the
money, as he waded through the crowd with a credit-card swiping
machine. Super PACs advocate and attack candidates through
independent expenditures like television ads. The committees
can’t contribute directly to campaigns.

“There will be others who say, ‘Stephen Colbert, what will
you do with that unrestricted Super PAC money?’” he said. “To
which I say, I don’t know. Give it to me and you’ll find out.”

Advocates for stricter campaign finance law praised the
narrow nature of the FEC ruling.

‘Right Compromise’

“We think it strikes the right compromise in terms of
granting the media exemption to only some of Colbert PAC’s
activities,” said Tara Malloy, associate counsel at the
Campaign Legal Center.

The Campaign Legal Center and other groups urged the FEC to
reject Colbert’s petition, saying it could open up a “gaping
loophole” in the law and let media companies fund political
committees. The groups cited politicians such as former Alaska
Governor Sarah Palin and former Arkansas Governor Mike Huckabee,
who work as paid commentators on Fox News while accepting money
for their political action committees.

“If the press exemption were to be so dangerously expanded
by the FEC, the next request will be for media companies to
directly finance unlimited candidate campaigns under the press
exemption -- an abuse that is already being advocated in some
quarters,” Craig Holman, government affairs lobbyist with
Public Citizen, which advocates for tougher regulation of
campaign laws, said in a June 29 statement.

“Stephen Colbert is a funny man, but he asked a legitimate
question and received a serious answer,” she said in a
statement. “Although some encouraged the commission to treat
this request differently because he uses humor as a vehicle for
his commentary, I believe such an approach would have been
unwise and untenable.”